Question

Unit 1

Question 1                                                                                                           (Total: 18 marks)

The following information was taken from the accounting records of Dunbar Mifflin Company in 2018.

                                                                                             Beginning of 2018             Ending of 2018

Direct materials inventory                                         135,000                                 83,000

Work-in-process inventory                                       185,000                                 154,000

Finished-goods inventory                                          255,000                                 216,000

Purchases of direct materials                                                                                   270,000

Direct manufacturing labor                                                                                       225,000

Indirect manufacturing labor                                                                                    103,000

Plant insurance                                                                                                              11,000

Depreciation-plant, building, and equipment                                                    48,000

Plant utilities                                                                                                                   29,500

Repairs and maintenance-plant                                                                              13,500

Equipment leasing costs                                                                                             66,800

Marketing, distribution, and customer-service costs                                      129,500

General and administrative costs                                                                           72,500

Required:

1. Prepare a schedule of cost of goods manufactured.

Answer 1

Solution

Dunbar Mifflin Company
Schedule of Cost of Goods Manufactured
For year ended December 31, 2018
Direct Material
Raw material Inventory Beginning	$     135,000.00
Raw material Purchased	$     270,000.00
Raw material available for use	$     405,000.00
Less: Raw material Inventory Ending	$        83,000.00
Direct Material Used		$      322,000.00
Direct labor		$      225,000.00
Manufacturing overheads
Indirect manufacturing labor	$     103,000.00
Plant insurance	$        11,000.00
Depreciation-plant, building, and equipment	$        48,000.00
Plant utilities	$        29,500.00
Repairs and maintenance-plant	$        13,500.00
Equipment leasing costs	$        66,800.00
Total Manufacturing overheads		$      271,800.00
Total manufacturing Cost During the month		$      818,800.00
Add: Work in process Beginning		$      185,000.00
Total Work in Process		$   1,003,800.00
Less: Work in progress Ending		$      154,000.00
Cost of Goods Manufactured		$      849,800.00